Mindanao hubs get subsidized power rate

December 5, 2016 at 12:00

The Department of Energy is expected to provide a subsidized electricity rate of P2.75 per kilowatt-hour to the locators in existing and future economic zones in Mindanao to encourage investors to set up shop on the country’s second biggest island.

“(Energy Secretary Alfonso) Cusi told me they have decided to provide a power subsidy to all special economic zones in Mindanao and this means our locators will only be paying P2.75 per kWh for their electricity consumption—that’s the support of the DOE to our special ecozones program,” according to Philippine Economic Zone Authority director general Charito B. Plaza.

“That is already a sure thing. In fact, we’re putting it in a memorandum of agreement. Government remains the biggest supplier of power in Mindanao through the Agus-Pulangi (hydropower plant). The DOE will be providing electricity at cost,” Plaza added.

According to Plaza, they are already drafting the MOA and that they are hoping to sign the agreement soon so they can step up efforts to convince investors to relocate to Mindanao.

“In fact, I’m already telling investors to expand their industries in Mindanao because the DOE will give us P2.75 per kWh. This will only be applicable to Mindanao because it has (few) economic zones that had been neglected for so many years. That’s why we’re now giving priority to the creation of ecozones in Mindanao and, later, we will go to Visayas and Luzon,” Plaza said.

“We have Peza teams now going around Mindanao, talking to governors and mayors, the business chambers, land owners who have more than 25 hectares. They are helping us identify potential ecozone sites,” the Peza chief added.

It was not made clear, however, if the electricity rate cited by Plaza referred only to generation charge or it already included other charges including those for transmission, distribution and system losses.

Data from state-run National Power Corp., which continues to operate the Agus-Pulangi hydropower complex, showed that its effective electricity rate stood at P2.8459 per kWh. This amount referred to the agency’s rate to customers being served by the remaining unsold plants that are being operated by Napocor.

Source: https://business.inquirer.net/220741/mindanao-hubs-get-subsidized-power-rate